In recent years, Kerry has made several strategic acquisitions of U.S. companies. In 2015, the firm, together with Wellmune, acquired Island Oasis, a Massachusetts-based supplier of beverages and equipment for the hospitality industry. Additionally, it purchased Wisconsin’s Red Arrow Products, a provider of smoke flavorings for meat, in a transaction valued at $735 million. Earlier, in 2014, Kerry acquired Wynnstarr Flavors and the savory division of Kraft Food Ingredients, KFI Savory. The year 2011 saw the completion of its acquisition of Cargill Flavor Systems for $230 million.
With the recent acquisition of Ganeden, Kerry is enhancing its presence in the health and wellness market. Ganeden is best known for its patented probiotic strain, GanedenBC30, and has recently introduced an inactivated probiotic named Staimune, which the company claims offers similar immune-boosting and anti-inflammatory properties. Ganeden produces a strain of probiotics that can be incorporated into a wide range of food and beverage products, making it a valuable asset for its new parent company. Michael Bush, President and CEO of Ganeden, recently told Food Dive that the company has “essentially created this market space” and has been doubling its growth every few years. “We were pioneers in baking mixes, probiotic waters, juices, and protein powders. We have achieved numerous firsts that are difficult to list,” he stated.
In response to the growing demand for probiotics, manufacturers are increasingly acquiring probiotic companies or integrating these beneficial bacteria into various products. For instance, PepsiCo acquired the probiotic beverage producer KeVita and recently introduced its Tropicana Essentials Probiotics line. Additionally, 301 INC, the venture capital arm of General Mills, led a $6.5 million Series D funding round in March to support Farmhouse Culture, a startup focused on fermented and probiotic food and beverages.
The global probiotics market reached $34 billion in sales in 2015, as reported by BCC Research, with the food and beverage sector accounting for 73%, or $24.8 billion, of that total. It is anticipated that the global probiotics market will grow at a compound annual growth rate (CAGR) of approximately 7.3% over the next decade, reaching an estimated value of about $74.7 billion by 2025.
Clearly, the Kerry Group is making a savvy move by acquiring Ganeden at this juncture. This acquisition not only strengthens its foothold in the health and wellness sector but also positions the company to leverage advancements in the rapidly growing probiotics and functional foods markets. Furthermore, as the demand for products like calcium citrate OTC increases, Kerry will be able to innovate and expand its offerings in this promising area. The integration of Ganeden will enable Kerry to enhance its portfolio with probiotics, calcium citrate OTC, and other health-focused ingredients, keeping it competitive in an evolving industry.